Friday, December 1, 2017

Federal Reserve Confirms It is Considering Its Own Digital Currency

Is a Federal Reserve bitcoin crackdown coming to make way for FedCoin?
The president of the Federal Reserve Bank of New York, William Dudley, has been asked about bitcoin multiple times at recent speaking engagements, reports Reuters.

On Wednesday, Dudley spoke to a group of students and professors at Rutgers University, at that event he said the Fed is considering offering their own form of digital currency — much like Russia is doing with the CryptoRuble and Japan with the J-Coin — but such an offering wouldn’t come to fruition any time soon.

“At this point, it’s really premature to be talking about the Federal Reserve offering digital currencies,” said Dudley. “But it is something we are starting to think about: what would it mean to have a digital currency, what would it mean to offer it, do we actually need it?”

During a separate talk that took place on Monday, Dudley was reportedly asked if digital currencies were a new form of exchange, a commodity, “a roulette wheel,” or “a tulip,” he responded by noting that central banks could consider offering cryptocurrencies as a substitute for cash “down the road,” but before that could happen, the Federal Reserve would need to determine whether or not digital currencies were “a more efficient medium of exchange than cash.”

And then, of course, we just had new Fed governor Randall Quarles warn that digital currencies serious pose financial stability issues if they gain large scale use.

Bottom line: Expect an eventual strong crackdown attempt by the government on the use of non-Fed digital currencies. It is one of four dangers a warn about for Bitcoin in Who is Buying Bitcoin and When Will They Stop?.


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